Conservation through Collusion: Antitrust as an Obstacle to Marine Resource Conservation

Article excerpt

I. Introduction

In the 1930s, Frank Manaka sought work as a fisherman off the coast of Monterey, California. He chartered a boat but was unable to fish or market his catch. Local canneries would not purchase fish from him. In 1940, he filed suit against the Monterey Sardine Industries, Inc., a cooperative association of fishing boat owners, and the Del Mar Canning Company for allegedly conspiring to set prices and restrict entry into the California sardine fishery.1 Under an agreement between the association, the local canneries, and the local fishermen's union, the association set the price for which its members' fish were sold to canneries and reduction plants.2 The canneries, in turn, agreed to purchase fish exclusively from members of Monterey Sardine assigned to them by the association. Manaka was not a member, so he could not sell his fish.3

Although Monterey Sardine may have operated like the typical collusive cartel, it served both pecuniary and conservation purposes. On the one hand, it increased members' profits by restricting entry by nonlocal fishers and increasing fish prices. On the other, it helped to conserve fish stocks by limiting the harvest.4 Challenged by Manaka, the court found Monterey Sardine Industries guilty of conspiracy in restraint of trade under the Sherman Act.5 The federal district court noted that the association was "not freed from the restrictive provisions of the anti-trust act" merely because they sought "the conservation of important food fish."6 In other words, the association's conduct was no less exclusionary because it served, in part, to conserve fish stocks.

In the 1930s, the California sardine fishery was at its peak, yielding over 500,000 tons of fish per year.7 By the early 1950s, the annual catch had dropped to under 20,000 tons, as the fishery began to collapse; "the pressures on the fishery were too great, and by 1952 for all practical purposes, the commercial sardine fishery was finished."8 It is possible that the sardine fishery's collapse was unavoidable. Commercial harvesting might have depleted the fishery even if Monterey Sardine Industries' collusive arrangement had been permitted to survive. Likewise, changing environmental conditions might have made the collapse inevitable.9 Then again, perhaps if it were not for antitrust enforcement, this tragedy of the marine commons might have been avoided.

Although it is not a new environmental problem, overfishing is arguably one of the most serious environmental problems today.10 Despite decades of government regulation, fisheries are in trouble the world over." "Forty-five years of increasing fishing pressure have left many major fish stocks depleted or in decline," reports the World Resources Institute.12 Approximately 65% of fisheries are fully exploited or overexploited, according to the United Nations Food and Agriculture Organization (FAO), and the number of overexploited fish stocks continues to climb.13 An additional 10% of fisheries are "significantly depleted" or are producing less than their potential because they are recovering from depletion.14 Canada closed its Atlantic cod fishery in 1992 when stocks were on the verge of collapse. Ten years later, some stocks are "barely recovering,"15 and others need to be closed again.16 Fisheries scientists recommended a similar ban on European catches of Atlantic cod in 2002.17 Although global fish production has increased significantly over the past three decades, much of this increase has come from an expansion of aquaculture as production from capture fisheries has leveled off since the 1990s.18 The rest is an artifact of "massive over-reporting" of fish catches by the People's Republic of China.19 Moreover, there is increasing concern that efforts to maintain catch quantity is diminishing catch quality and undermining fishery sustainability.20 According to one recent study, stocks of large ocean fish species have dropped to 10% of their historic levels due to overfishing. …